| Update Applicable to: | Effective date |
| All U.S. and Foreign entities created in or registered to do business in the U.S., or any employers who use special purpose entities created by the filing of a document with a Secretary of State (or similar office under state law, Indian Tribal law, or foreign jurisdictions). | February 20, 2024 |
What happened?
The Financial Crimes Enforcement Network (FinCEN) issued the most anticipated final rule regarding the access and safeguard provisions of the Corporate Transparency Act (CTA), known as the Access Rule.
What are the details?
The Access Rule prescribes the circumstances under which Beneficial Ownership Information (BOI) reported to FinCEN may be disclosed to authorized BOI recipients, and how it must be protected.
The Access Rule:
- Protects sensitive information from unauthorized disclosure while creating a useful database for BOI recipients.
- Is the result of extensive interagency consultations and the public comments received in response to FinCEN’s December 16, 2022, Proposed Rulemaking.
- On a phased basis, will be provided access to the BOI database for authorized users.
- The first stage will be a pilot program for a handful of key Federal agency users starting in 2024.
- Refer to the full rule for further details.
FinCEN also noted that it will issue a proposed rule to revise the current Customer Due Diligence (CDD) Rule, but did not give any specific timeline to its release.
Business Considerations
- Review the specifics of your business to determine how to better adjust your policies, practices, and procedures, due to the different framework given to banks and non-financial institutions.
- Plan communication and training with your key personnel.
- It is recommended to keep your accountants and attorneys in the loop should you need assistance during the process. Updates to filing should be made quickly and accurately.
Resources
- Financial Crimes Enforcement Network Videos
- BOI Access and Safeguards (Final Rule)
- FinCEN Press Release
- FinCEN Statement for Banks on BOI Access Rule
- FinCEN Statement for non-bank financial institutions on BOI Access Rule
- FinCEN Fact Sheet on BOI Access and Safeguards Final Rule
Source References
- FinCEN Issues Final CTA BOI Access Rules, Heralded by YouTube Video (Ballard Spahr LLP.)
- FinCEN issues final rule on access to the beneficial ownership information reported under the Corporate Transparency Act (Wolters Kluwer N.V. and/or its subsidiaries)
- FinCEN Issues Final Rule on Access to Beneficial Ownership Information: Seven Things To Know (Covington & Burling LLP.)
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